Payday loans can be a great solution for consumers that want instant access to small amounts of cash for a short term period. These loans can be taken out for amounts ranging between £80-£750 and are meant to be paid back when your next pay day comes along. They are given based on your income, need no security and do not involve credit checks.
This means that anybody can make an application for a quick and simple cash injection. Most people using this kind of same day cash advance will do so on the basis that they have had some sort of cash emergency such as an unexpected bill coming in or they simply want to buy or do something now that cannot wait till they next get paid.
Payday loans are not, however, designed to be used as a method of getting long term finance. You pay a simple flat fee for your borrowing here which will fall due with the balance that you owe next payday. So, for most people this is a solution that they use every now and then when they need to when they want instant cash borrowing without getting into long term debt.
If, however, you are having debt problems and start to use payday loans as a solution to your cash access needs every month then you may need to think about your spending and credit habits. Relying on a payday loan for extra cash every single month is not the way to sort out spending or debt issues and you may be better off with a longer term loan that sorts out your finances if this is the case with you.
It is also wise to avoid falling into the trap of ‘rolling over’ a payday loan for months on end. Most payday loans providers will allow you not to pay back your borrowing on its due date in certain cases and you can roll your borrowing over to the next month. This will, naturally enough, increase your borrowing costs.
It doesn’t matter so much if you rollover in this way every now and then but, if you find that you cannot pay off your original loan here because of wider debt issues and roll over for months at a time, then you may, again, want to find a different solution to get your finances back on track.
Used sensibly, payday loans are a great option for most people. They can arranged in minutes online, can give you the cash you need on a same day cash advance basis and can be paid off in just days or weeks. But, they won’t suit every situation so it is wise to look at all your options first if you worry about your own ability to repay this kind of loan.
Getting into debt can be easy and payday loans can actually help you out here by making sure that difficult cash months don’t turn into a longer term crisis. But, if your existing debts are becoming hard to handle then this may not be a solution to look at for you right now although it may well work for you in the future. To get advice on debt management, take a look at the Consumer Credit Counselling Service (www.cccs.co.uk) for free impartial advice.